What happens if we cant pay for my wifes private student loan? 17 Answers as of June 26, 2013

My wife has a private student loan of 12k that secured by her only that was not discharged in the bankruptcy. I lost my job and we are not able to pay. What can bank do? What about community property? Can they attach to her wages or freeze our bank accounts?

If it is a community debt, then community property is liable. This could be so if you live in Wisconsin, but not in Illinois. I doubt you'll see wage attachments or bank freezes unless you get sued and the loan goes to judgment.

Ohio is not a community property state. So unless you have previously lived in a community property state, you are OK. But your wife has a problem. If she is not working, she should ask for any kind of deferment possible. If that is not possible, she can file a Chapter 13 plan just for the purpose of paying off her student loans. Yes, the student loans are so too subject to the jurisdiction of the Bankruptcy Court. You need to have some ability to pay to file a 13, so a job is usually needed. If you don't communicate and don't pay, that's when bad things happen. Student loans have many really extraordinary means of collecting against your wife. Don't tempt them. Either get into deferment, make a deal to pay, or get into a Chapter 13. Good luck.

Student loans are not dischargeable in Bankruptcy. You must contact the company and attempt to use their deferment programs. All student loan companies have programs designed to hold off on payment for people who run into financial hardship. Please contact them immediately.

Your various questions about your wife's student loan are a bit complex. You are not responsible for your wife's student loans unless you and she refinance them into a common debt. Don't do that. Also, they can sue her and garnish her wages, but not yours. The best way to protect your money is to have it in your name alone but not in her name. That way the student loan people cannot reach the money in your account. As for your question about community property, New York does not use that legal concept, so that is inapplicable to New York bankruptcy and debtor/creditor cases.

Student loans survive bankruptcy. If the debt is reduced to a judgment it can be enforced. There are many kinds of collection procedures, including wage garnishment and bank levy. Try to make a monthly payment settlement offer.

The bank can pursue all normal collection actions including filing suit to collect the balance owed. Once the bank obtains a judgment, the bank can issue a garnishment or levy on joint bank accounts. If you have no liability on the debt, it might be wise for you to have your money in separate accounts. Depending on when your wife filed her last case, she may be eligible to file a Chapter 13 case and pay the student loans over a 5 year period of time. If she is able to pay the loans over the 5 years, the bank would be stayed from filing suit, garnishing her wages, or seizing her assets.

worse than that.... they do nothing and let the interest accrue so that the debt grows huge. At least try to pay the interest so the debt does not grow. Not likely they will garnish or attach, that requires a lawsuit first.

I think a private student loan is discharged and most jurisdictions, as far as I know, allow non-listed creditors to be discharged by simply sending them a notice of the discharge after it happens. If it was an asset case it's all different. If it's not dischargeable under Bankruptcy law, you can ask for extensions and hardship forebearances. I don't know about community property, but they can attach wages and they can free bank accounts. In case it helps in community property, you can put most of the money in an account in your name only and some in hers.

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